Perpetuities Georgian College is considering the establishment of a $970,000 endowment held in perpetuity for the chair of the Henry Bernick Entrepreneurship Centre. The ongoing cost would be $7,400 at the end of each month. a.) Find the nominal annual interest rate compounded monthly. (Correct to 4 decimals) Hint: Use the BA II Plus - Set N = 10,000) b.) Find the interest rate per month. (Correct to 4 decimals) c.) Find the annual effective rate of interest. (Correct to 4 decimals)

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ISBN:9780470458365
Author:Erwin Kreyszig
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Perpetuities
Georgian College is considering the establishment of a $970,000 endowment held in perpetuity for the chair of the Henry Bernick
Entrepreneurship Centre. The ongoing cost would be $7,400 at the end of each month.
a.) Find the nominal annual interest rate compounded monthly. (Correct to 4 decimals)
Hint: Use the BA II Plus - Set N = 10,000)
b.) Find the interest rate per month. (Correct to 4 decimals)
c.) Find the annual effective rate of interest. (Correct to 4 decimals)
Transcribed Image Text:Perpetuities Georgian College is considering the establishment of a $970,000 endowment held in perpetuity for the chair of the Henry Bernick Entrepreneurship Centre. The ongoing cost would be $7,400 at the end of each month. a.) Find the nominal annual interest rate compounded monthly. (Correct to 4 decimals) Hint: Use the BA II Plus - Set N = 10,000) b.) Find the interest rate per month. (Correct to 4 decimals) c.) Find the annual effective rate of interest. (Correct to 4 decimals)
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